Market Watch: Peloton Plunges, Planet Fitness Surges
Last week, Peloton’s pandemic bubble popped. Meanwhile, Planet Fitness surged. Hardly an apples-to-apples comparison, exercise seekers are proving hard to pin down.
Miss. Since reporting its Q1 2022 earnings last week, Peloton has shed more than $10B in market cap.
- The connected fitness company missed earnings estimates of $810.7M, reporting $805.5M, as losses widened.
- A red flag, Peloton scaled back its FY2022 revenue forecast by up to $1B.
- As demand for its connected equipment softens, existing members are less engaged, with average monthly workouts reportedly sinking to 16.6 from a high of 26.
As the stock cratered, on Friday, Peloton instituted a hiring freeze across all departments. Year to date, the stock is down more than 63% with a market cap of ~$15.5B, down from $44B in January.
Beat. On the flip side, Planet Fitness beat earnings and revenue estimates, as memberships approach pre-pandemic levels.
- Membership topped 15M, representing 97% of its pre-COVID peak.
- Total revenue was up 46% YoY to $154.3M.
- Net income reached $18.6M versus a loss of $3.3M in the prior-year period.
Looking ahead, Planet Fitness raised its full-year outlook, forecasting $570–580M in revenue with 110–120 new locations. The gym chain’s stock is up more than 23% year to date.
The big picture: While the Pelotons of the world downplay recent developments, brick-and-mortar operators like Planet Fitness are taking a victory lap.
There’s no denying that the gym is being unbundled. But it’s also true that Peloton and digital/at-home fitness companies have had their growth juiced for nearly 24 months. Now, as the playing field levels, every move and every metric will be scrutinized.
Punchline: No one actually knows where consumer preferences will land. Sure, omnichannel offerings will be a piece of the puzzle. But, between at-home and in-person fitness, neither camp is in the clear. Best case, exercise seekers are the real winners, as increased access, convenience, and personalization lead to meaningful health outcomes.
